Farm Subsidieshttp://www.businessinsider.com/category/farm-subsidies
en-usTue, 03 Mar 2015 14:43:02 -0500Tue, 03 Mar 2015 14:43:02 -0500The latest news on Farm Subsidies from Business Insiderhttp://static3.businessinsider.com/assets/images/bilogo-250x36-wide-rev.pngBusiness Insiderhttp://www.businessinsider.com
http://www.businessinsider.com/chris-van-hollen-unemployment-benefits-farm-bill-2013-12Here's One Top Democrat's Plan To Win An Extension Of Unemployment Benefitshttp://www.businessinsider.com/chris-van-hollen-unemployment-benefits-farm-bill-2013-12
Fri, 13 Dec 2013 15:11:00 -0500Danny Vinik
<p><img style="float:right;" src="http://static4.businessinsider.com/image/4b40b1f40000000000278f14-511-371/foodstamps.jpg" border="0" alt="Food stamps" /></p><p>The&nbsp;Washington Post's Greg Sargent reports that <a href="http://www.washingtonpost.com/blogs/plum-line/wp/2013/12/13/dems-hatch-new-strategy-to-pressure-gop-on-unemployment-insurance/">Rep. Chris Van Hollen (D-Md.) is organizing Democrats to vote against </a>any farm bill that does not also include an extension of emergency unemployment benefits.</p>
<p>Van Hollen, the ranking Democrat on the House Budget Committee and a former chairman of the Democratic Congressional Campaign Committee, is considered an influential member of the caucus.</p>
<p>He says the farm bill, which generally enjoys bipartisan support but is especially important to Republicans representing rural districts, provides Democrats' next opportunity to force the Republican Party's hand on unemployment.</p>
<p><span style="line-height: 1.5em;">House and Senate negotiators are currently trying to reconcile each side's version of the bill, which expires on Jan. 1. Yesterday, t<span>he House passed a one-month extension to give negotiators more time time to work out a deal. The Senate will take it up next week.</span> </span></p>
<p><span style="line-height: 1.5em;">The farm bill is mainly made up of the Supplemental Nutrition Assistance Program (food stamps) and farm subsidies. If it lapses, the law reverts back to a version passed in 1949. That would send milk prices soaring to $8 per gallon. It would also cause an interruption in various farm programs, but SNAP benefits would continue to be issued.</span></p>
<p>The House failed to pass a comprehensive farm bill this summer, instead passing one that dealt with farm programs and a separate one for SNAP that cut benefits by $40 billion over 10 years. The comprehensive Senate bill includes $4 billion in SNAP cuts. The legislation that comes out of conference will include fewer cuts than many House Republicans will accept, forcing House Speaker John Boehner to need Democratic votes to pass the final bill. This is where Van Hollen sees an opportunity for House Democrats.</p>
<p><span>"Under no circumstances should we support the farm bill unless Republicans agree to use the savings from it to extend unemployment insurance," he told Sargent.</span></p>
<p><span>"I&rsquo;m confident that the House Democratic leadership will look for every opportunity to extend unemployment insurance, helping struggling families and the economy. The farm bill reauthorization may be the first such opportunity.&rdquo;</span></p>
<p>Shortly after Christmas, the Emergency Unemployment Compensation (EUC) program expires and 1.3 million Americans will lose their jobless benefits. The program extends the length of time that unemployed workers could collect benefits from the standard 26 weeks to as long as 73 weeks, though the maximum duration of benefits varies by state.</p>
<p>In recent weeks, Democrats have pushed hard for another extension of the EUC. Sen. Patty Murray bargained with Rep. Paul Ryan last weekend about including it in their budget, but ultimately lost out. Majority Leader Harry Reid has said that he will push for an extension after New Year's.</p><p><a href="http://www.businessinsider.com/chris-van-hollen-unemployment-benefits-farm-bill-2013-12#comments">Join the conversation about this story &#187;</a></p> http://www.businessinsider.com/heritage-fight-with-republicans-is-a-disaster-2013-8New Heritage Foundation Fight Shows Everything That's Wrong With The GOPhttp://www.businessinsider.com/heritage-fight-with-republicans-is-a-disaster-2013-8
Thu, 29 Aug 2013 12:00:00 -0400Josh Barro
<p><img style="float:right;" src="http://static2.businessinsider.com/image/50c100dfecad046b6a000013-480-/demint.12.12.jpg" border="0" alt="jim demint" width="480" /></p><p>Even conservative House Republicans have finally had it with the Heritage Foundation, the conservative think tank that has aggressively pushed Republican congressmen to the right.</p>
<p>National Journal <a href="http://www.nationaljournal.com/congress/republican-lawmakers-retaliate-against-heritage-foundation-20130828">reports</a> that the Republican Study Committee, a group of conservative House members with deep ties to Heritage, has banned Heritage employees from its meetings. They're mad that Heritage tried to kill a farm subsidy bill that Republican House members very much wanted to pass back in July.</p>
<p>I'm no fan of Heritage. But here's what's maddening about this fight: Heritage is not only right about the farm subsidy issue, they're advocating a consensus view among policy experts all across the political spectrum.</p>
<p>In 2011, the Peter G. Peterson Foundation commissioned long-term federal budget proposals from six think tanks spread across the political spectrum, from Heritage on the right end to the Economic Policy Institute on the left. The proposals diverged widely in most areas, from taxes to entitlements to defense. One of the <a href="http://pgpf.org/sites/default/files/sitecore/media%20library/PGPF/Media/PDF/2011/FiscalSummit_2011/2011%20Fiscal%20Summit%20Book.pdf">few areas of agreement</a> among all six proposals was that farm subsidies should be reformed and reduced.</p>
<p>Yet the farm bill that passed the Republican-held House this summer barely changes farm subsidy programs. It cuts direct payments to farmers, but offsets much of that cut by increasing the generosity of crop insurance, another mechanism of subsidizing agriculture.</p>
<p>The Congressional Budget Office estimates the net effect of the House plan would be about a 6% cut in farm subsidy programs. (That's actually a slightly smaller cut than Senate Democrats want, and much smaller than President Obama has proposed.) But that estimate assumes that crop prices stay high, like they are today. As the Mercatus Center <a href="http://mercatus.org/publication/bloated-farm-subsidies-will-2013-farm-bill-really-cut-fat">notes</a>, if prices fall back toward their long-run averages, the House bill will actually make farm subsidies <strong>more</strong> generous.</p>
<p>When the House tried in July to pass a comprehensive farm bill including a reauthorization of the food stamp program, 62 House Republicans rebelled because the cuts weren't deep enough. (The Republican plan included about a 3% cut in food stamps along with the 6% cut in farm subsidies). Because most Democrats voted against the bill on the grounds that it cut too much from food stamps, it failed.</p>
<p>Then, House Republicans separated the bills and passed a farm subsidies-only bill with just 12 Republican defections. Heritage infuriated House Conservatives by issuing a "key vote" against the bill, arguing that it did not align with Heritage's (perfectly reasonable) <a href="http://www.heritage.org/research/reports/2013/06/six-reforms-for-the-house-farm-bill">principles</a> for reforming and reducing farm subsidies.</p>
<p>In other words, about a third of the House GOP caucus is so committed to cutting food aid to poor people that they wouldn't vote for a bill with only modest cuts to that, even though their leadership really wanted them to. But 94% of House Republicans were willing to vote for a bill that maintains status-quo corporate welfare to farmers, and they're furious that meddling outsiders tried to stop them.</p>
<p><span>The RSC's problem with Heritage isn't that it's trying to push the GOP too far to the right to be competitive in elections. Their problem with Heritage is that they're interfering with the GOP's effort to put special-interest politics ahead of conservative principles.</span></p>
<p>House Republicans do not actually care about free markets or cutting government. They care about pleasing their electoral constituencies and getting re-elected. Old people tend to vote Republican, which is why House Republicans have built their last two campaigns around attacking President Obama with claims he was cutting Medicare. Almost all rural areas are represented by Republicans, which is why Republicans don't want to cut farm subsidies.</p>
<p><span style="line-height: 1.5em;">Internal critics of the Republican party are trying to push it in a variety of directions. Tea Partiers, like the people at Heritage, want the party to cut taxes and spending much more aggressively. Libertarian populists want to refocus around an anti-corporate welfare message. Squishy "reformists" like me want to make peace with progressive taxation and the welfare state while cutting regulation.</span></p>
<p>One thing all those camps can agree on is that farm subsidies should be slashed.&nbsp;<span>If that's the issue on which the House GOP is most inclined to defend existing spending and smack down outside critics, that bodes very poorly for any effort to make the GOP more competitive and more relevant.</span></p><p><a href="http://www.businessinsider.com/heritage-fight-with-republicans-is-a-disaster-2013-8#comments">Join the conversation about this story &#187;</a></p> http://www.businessinsider.com/farm-bill-expiration-and-the-milk-cliff-2013-6Beyond The Milk Cliff: What Happens If The Farm Bill Expireshttp://www.businessinsider.com/farm-bill-expiration-and-the-milk-cliff-2013-6
Mon, 24 Jun 2013 19:14:00 -0400Josh Barro
<p><img style="float:right;" src="http://static1.businessinsider.com/image/51c8cf77eab8ea8025000016-480-/farmer-cow-field.jpg" border="0" alt="farmer cow field" width="480" /></p><p>Last week, the House of Representatives <a href="http://www.businessinsider.com/house-farm-bill-vote-down-2013-6">defeated a Republican proposal</a> to reauthorize the farm bill, which contains farm subsidies and the Supplemental Nutritional Assistance Program, also known as food stamps.</p>
<p><span style="line-height: 1.5em;">And so it's time to talk about the "Milk Cliff."</span></p>
<p>If the farm bill expires, the Department of Agriculture will revert to 1940s-era rules about how to support dairy product prices. This would force it to buy up dry milk, butter, and cheese until it gets milk prices to roughly double to $8 per gallon.</p>
<p>The threat of the Milk Cliff got Congress to include an extension of the old farm bill as part of January's fiscal cliff deal. But that extension was only for a year, meaning the Milk Cliff looms again.</p>
<p><span style="line-height: 1.5em;">Of course, the farm bill is about a lot more than just milk. Here's what else would happen if no agreement is reached, with guidance from the <a href="http://nationalaglawcenter.org/assets/crs/R42442.pdf">Congressional Research Service</a>:</span></p>
<ul>
<li><strong style="line-height: 1.5em;"><strong style="line-height: 1.5em;">Some big programs, including food stamps, probably wouldn't be affected.&nbsp;</strong></strong><span style="line-height: 1.5em;">Unlike most of the programs in the farm bill, SNAP doesn't need to be reauthorized to stay in effect. This program accounts for almost 80% of spending in the farm bill. Congress would still need to appropriate money to fund SNAP, but that's done separately through the appropriations process and would likely proceed even if the farm bill were tied up. Subsidized crop insurance also stays in place whether a bill passes or not.</span></li>
<li><strong style="line-height: 1.5em;">The milk cliff also comes with a honey cliff.</strong><span style="line-height: 1.5em;">&nbsp;As with milk, reverting to 1940s-era rules would force the government to buy up honey to drive up prices. On the bright side, instead of doubling, honey prices would only go up about 40%.</span></li>
</ul>
<p><span style="line-height: 22.5px;"><img src="http://static4.businessinsider.com/image/51c8c9836bb3f7874a000023-1410-959/honey%20cliff.png" border="0" alt="honey cliff" width="800" /><br /></span></p>
<ul>
<li><strong><strong style="line-height: 1.5em;">Some farmers would get big windfalls from the farm bill lapsing.</strong></strong><span style="line-height: 1.5em;"> Aside from milk and honey, the government doesn't usually buy up crops to raise prices. Instead, it effectively pays farmers to make them whole when crop prices fall below targets. If the farm bill expires, price targets for wheat, rice, and cotton would rise far above current market prices, meaning big payments to farmers producing those crops. No such luck if you grow sorghum, oats, corn, or barley.<br /></span></li>
</ul>
<p><span style="line-height: 22.5px;"><img src="http://static4.businessinsider.com/image/51c8da9369beddbe6e000012-1410-959/sorghum%20updated.png" border="0" alt="sorghum updated" width="800" /><br /></span></p>
<ul>
<li><strong>Other farmers would lose programs dedicated to their interests.</strong> Lots of crops have been added to farm subsidy programs since 1948, and farmers growing these crops would see their price supports go away. These are chickpeas, lentils, mustard seed, various oilseeds, peas, sesame seeds, sugar beets, and sugar cane. But because today's agricultural prices are high, these crops are already selling above support prices set in the 2008 law, so these farmers wouldn't be any worse off in the short term.</li>
<li><strong>Nothing would get reformed.</strong> Both the House and Senate farm bills reduce and restructure the subsidies that the federal government provides to farmers. They also change SNAP: the Senate adds new enforcement measures aimed at reducing fraud, while the House bill tightens eligibility requirements in a way that would take benefits away from about two million people. Making any of those changes depends on passing a new farm bill.</li>
</ul>
<p><span style="color: #222222; line-height: 1.5em;">You shouldn't worry too much yet: the farm bill almost never gets done on time. The last time a new farm bill got enacted before the previous one expired was in 1977.</span></p>
<p><span style="color: #222222; line-height: 1.5em;"></span><span style="color: #222222; line-height: 1.5em;">The reauthorizations keep getting later: typically, the bills expire on September 30, and reauthorizations in the 1980s and early 1990s were completed in the fall, with only a few weeks of lapse. Since the Clinton Administration, they've been done in the spring, meaning we went six months with a lapsed farm bill. That's worked since a new bill was in place by the time any crops got harvested.</span></p>
<p><span style="color: #222222; line-height: 1.5em;"></span><span style="line-height: 1.5em;">Congress always acts sooner or later because the reversion to "permanent law" as written in the 1940s is so unacceptable. As CRS puts it,&nbsp;<span>"</span><span>The existence of permanent law thus likely forces Congress to take action, because inaction generally is considered to have unacceptable consequences&mdash;that is, reverting to a policy that almost everyone would regret."</span></span></p>
<p><span style="line-height: 1.5em;"><span>Avoidance of disaster is about the only thing that can get this Congress to move, and it's the only reason we'll get a new farm bill, sooner or later.</span></span></p><p><a href="http://www.businessinsider.com/farm-bill-expiration-and-the-milk-cliff-2013-6#comments">Join the conversation about this story &#187;</a></p> http://www.businessinsider.com/farm-bill-vote-fail-immigration-reform-boehner-2013-6The Farm Bill Failure Has Disastrous Implications For Boehnerhttp://www.businessinsider.com/farm-bill-vote-fail-immigration-reform-boehner-2013-6
Fri, 21 Jun 2013 16:02:00 -0400Brett LoGiurato
<p><img src="http://static1.businessinsider.com/image/51c47dd26bb3f7f62f00001b-750-/john-boehner-58.jpg" border="0" alt="John Boehner" width="750" /></p><p></p>
<p>It's hard to understate how much of a setback the <a href="http://www.businessinsider.com/joe-scarborough-farm-bill-john-boehner-vote-house-leadership-2013-6" target="_blank">farm bill's surprise failure</a> was for an already dysfunctional and divided House of Representatives.&nbsp;</p>
<p>It showed that House leadership doesn't have a complete measure of the vote counts for even the most basic bills. It provided embarrassment all the way up to House Speaker John Boehner, who took the unusual step of publicly supporting the bill and voting for it. And it signaled possible turbulence ahead for other larger and higher-profile bills, <a href="http://www.businessinsider.com/john-boehner-hastert-rule-immigration-reform-vote-house-2013-6" target="_blank">such as one on the issue of immigration</a>.&nbsp;</p>
<p><span>The debacle brings up fresh new questions about major legislation passing through the House. If Boehner can't bring his conference together to move a farm bill through to a conference committee, what does it mean for immigration, debt ceiling, and government appropriations bills looming later this summer and fall?</span></p>
<p>The looming immigration fight, in particular, parallels the farm bill in many ways, though it could hypothetically have even more disastrous consequences for the Republican Party if it fails.</p>
<p>A similar version of a Senate farm bill that earned bipartisan support in a 66-27 vote failed to pass the House. Soon, an immigration bill that <a href="http://www.businessinsider.com/bill-oreilly-endorses-immigration-reform-fox-news-2013-6" target="_blank">now looks likely to earn more than 70 bipartisan Senate votes</a>&nbsp;could present Boehner with the same problem.&nbsp;</p>
<p><span>"The two are very different issues. However, the farm bill highlights how complicated things are here in the House," one House GOP aide told Business Insider.&nbsp;</span></p>
<p><span>From here, the farm bill faces one of two likely fates &mdash; it could either face extinction, or House leadership could put a modified version on the floor. It's unlikely, though, that a modified bill will come to the floor, considering that it would likely take more food-stamp cuts to earn Republican votes &mdash; something that would scare off Democrats. Most likely, a GOP aide said, a one-year extension will be passed, like both the House and Senate did last year.</span></p>
<p><span>A final version of any farm bill, even a one-year extension, will likely need a majority of Democrats to support its passage. The House last passed a farm bill extension as part of the bill to avert the fiscal cliff, which passed with a majority of Democrats supporting it. That overall bill required Boehner to break the Hastert Rule.</span></p>
<p>On immigration, Boehner will have an even narrower path to navigate. He has pledged to not allow a vote on a bill that does not garner&nbsp;majority support from Republicans. It's clear that breaking that promise, however, is perhaps the only way a bill would pass through the House to become law &mdash; even if the Senate bill is watered down to earn more Republicans' support.&nbsp;</p>
<p>Doing so would likely mean Boehner would face a revolt from conservative members of his caucus. Already, Rep. Dana Rohrabacher (R-Calif.) <a href="http://www.politico.com/story/2013/06/dana-rohrabacher-john-boehner-speaker-92954.html" target="_blank">has warned him on his speakership</a>.&nbsp;</p>
<p>One Democratic strategist, though, said Boehner might have to be willing to buck the majority of his caucus to do something he feels is necessary for the future of the party. The strategist pointed to comments from Sen. Lindsey Graham (R-S.C.) last weekend, who cautioned immigration reform was necessary to <a href="http://www.businessinsider.com/lindsey-graham-immigration-reform-70-votes-republicans-2013-6" target="_blank">keep the GOP from falling into a "demographic death spiral."</a></p>
<p>"He might have to decide between the short-term imperative of keeping his speakership," the strategist said, "and the long-term imperative of the future of the Republican Party."</p><p><a href="http://www.businessinsider.com/farm-bill-vote-fail-immigration-reform-boehner-2013-6#comments">Join the conversation about this story &#187;</a></p> http://www.businessinsider.com/joe-scarborough-farm-bill-john-boehner-vote-house-leadership-2013-6Joe Scarborough Blasts House Republicans' Embarrassing Absence Of 'Competence' http://www.businessinsider.com/joe-scarborough-farm-bill-john-boehner-vote-house-leadership-2013-6
Fri, 21 Jun 2013 09:16:04 -0400Brett LoGiurato
<p><img style="float:right;" src="http://static1.businessinsider.com/image/51c450836bb3f7f65800000d-480-/joe-scarborough-4.png" border="0" alt="Joe Scarborough" width="480" /></p><p>MSNBC host Joe Scarborough blasted what he called an "embarrassment" in <a href="http://www.businessinsider.com/house-farm-bill-vote-down-2013-6" target="_blank">the House's failure to pass a farm bill</a>, blaming a lack of "competence" from Republican leadership.&nbsp;</p>
<p><span>"This isn't Washington being dysfunctional so much as it is that the House GOP leadership just got blindsided in a way you should never be blindsided if you're running the House," Scarborough said of the bill's surprise failure, on which both sides of the aisle blamed the other.&nbsp;</span></p>
<p><span>Scarborough called it a "stinging indictment" for House Speaker John Boehner that he couldn't pass "basic bills" because of a revolt from members of his party.&nbsp;</span></p>
<p><span>Scarborough said that the bill's failure doesn't bode well for upcoming issues like immigration reform. Boehner has said he won't bring a bill to the floor without majority of support from House Republicans.&nbsp;</span></p>
<p><span>"This farm bill was a great example," Scarborough said. "You had overwhelming support of this farm bill over in the Senate, and it didn't pass the House. I think people that think immigration is going to pass [the House] if you get 65-70 votes [in the Senate] are whistling past a graveyard."</span></p>
<p>Watch the clip below, via MSNBC: <object id="msnbc786e4f" classid="clsid:D27CDB6E-AE6D-11cf-96B8-444553540000" codebase="http://download.macromedia.com/pub/shockwave/cabs/flash/swflash.cab#version=10,0,0,0" width="592" height="346"><param name="movie" value="http://www.msnbc.msn.com/id/32545640" /><param name="FlashVars" value="launch=52272308^24397^481516&amp;width=592&amp;height=346" /><param name="allowScriptAccess" value="always" /><param name="allowFullScreen" value="true" /><param name="wmode" value="transparent" /><embed name="msnbc786e4f" src="http://www.msnbc.msn.com/id/32545640" width="592" height="346" flashvars="launch=52272308^24397^481516&amp;width=592&amp;height=346" allowscriptaccess="always" allowfullscreen="true" wmode="transparent" type="application/x-shockwave-flash" pluginspage="http://www.adobe.com/shockwave/download/download.cgi?P1_Prod_Version=ShockwaveFlash" /></object></p>
<p style="font-size: 11px; font-family: Arial, Helvetica, sans-serif; color: #999; margin-top: 5px; background: transparent; text-align: center; width: 592px;">Visit NBCNews.com for <a href="http://www.nbcnews.com">breaking news</a>, <a href="http://www.msnbc.msn.com/id/3032507">world news</a>, and <a href="http://www.msnbc.msn.com/id/3032072">news about the economy</a></p><p><a href="http://www.businessinsider.com/joe-scarborough-farm-bill-john-boehner-vote-house-leadership-2013-6#comments">Join the conversation about this story &#187;</a></p> http://www.businessinsider.com/house-farm-bill-vote-down-2013-6In A Big Blow To Boehner, House Defeats Farm Billhttp://www.businessinsider.com/house-farm-bill-vote-down-2013-6
Thu, 20 Jun 2013 14:24:00 -0400Josh Barro
<p>Today, the House defeated a Republican farm bill proposal on a&nbsp;195-234 vote. The bill included cuts to the Supplemental Nutritional Assistance Program, commonly known as food stamps, that were not in a version that easily passed the Senate last week, 66-27.</p>
<p><img src="http://static4.businessinsider.com/image/51c344b269beddbf1600000b-800-/c%20span%20vote.jpg" border="0" alt="c span vote" width="800" /></p>
<p>Opposition was bipartisan. Almost all Democrats voted no because they opposed the food stamp cuts. But 60 Republicans also voted against the bill, mostly because it didn't cut enough.</p>
<p>This is another demonstration of the impossible hand that Speaker John Boehner is playing. He wants his caucus to pass alternatives to Democratic policy proposals from the Senate. But the conservative wing of his caucus places high demands and is willing to vote against leadership-backed proposals.</p>
<p>If he doesn't meet their demands, he risks defeats like today's.</p>
<p>Conservative inflexibility leaves only two ways to get any legislation through the House. One is to design a bill that is so conservative it gets nearly all Republican support. Often, this means a bill that will be very unpopular with the public.</p>
<p>Another is to let the Democratic minority provide most of the votes, which means letting them dictate the contents of the bill.&nbsp;<span style="line-height: 1.5em;">Boehner's use of Democrat-heavy to pass legislation on major policy matters&mdash;the fiscal cliff, the debt ceiling increase, and quite possibly immigration reform&mdash;has led to Minority Leader Nancy Pelosi getting the nickname "Speaker Pelosi."</span></p>
<p>There has to be a farm bill. Reauthorizing farm subsidies is (unfortunately) a political necessity, and so is reauthorizing food stamps. That leaves Boehner two options. He can come back with a bill that cuts food stamps more deeply. Or he can summon "Speaker Pelosi" to help him pass a bill that resembles the Senate version, which passed with widespread Democratic support and backing from nearly half of Republicans, too.</p>
<p>Either way, he's going to look weak.</p><p><a href="http://www.businessinsider.com/house-farm-bill-vote-down-2013-6#comments">Join the conversation about this story &#187;</a></p> http://www.businessinsider.com/brazil-agriculture-boom-mato-grosso-2012-12Welcome To Mato Grosso, The Giant Swath Of Land That's Feeding The Entire Worldhttp://www.businessinsider.com/brazil-agriculture-boom-mato-grosso-2012-12
Fri, 21 Dec 2012 09:59:00 -0500Rob Wile
<p><img style="float:right;" src="http://static4.businessinsider.com/image/50cf5727ecad04586e000006-396-297/brasil2.png" border="0" alt="brazil farming" /></p><p>Since World War II, the U.S. has been hailed as the world's breadbasket, pumping grains and meat from its fertile heartland out to the world.</p>
<p>But another country is snatching that mantle away: Brazil.</p>
<p>In 2001, Brazilian agricultural exports totaled $16 billion, <a href="http://www.fas.usda.gov/info/IATR/012412_Brazil/012412_Brazil.pdf">according to USDA analyst Oliver Flake</a>. By 2010 exports had climbed to a record $62 billion and reached approximately $80 billion in 2011.</p>
<p>That represents an increase of 400 percent over 10 years. Comparatively, U.S. exports rose about 175 percent over the same period, Flake says.</p>
<p>What's their secret?</p>
<p>A place called Mato Grosso.</p><h3>Here's where Mato Grosso is located.</h3>
<img src="http://static2.businessinsider.com/image/50d476066bb3f7eb7600001c-400-300/heres-where-mato-grosso-is-located.jpg" alt="" />
<br/><br/><h3>It's pretty much comprised four large clusters of farms.</h3>
<img src="http://static2.businessinsider.com/image/50d4770deab8ea491300000e-400-300/its-pretty-much-comprised-four-large-clusters-of-farms.jpg" alt="" />
<br/><br/><h3>And here's the Mato Grosso Institute of Agricultural Economics' version of that map.</h3>
<img src="http://static5.businessinsider.com/image/50d34b4969bedde322000000-400-300/and-heres-the-mato-grosso-institute-of-agricultural-economics-version-of-that-map.jpg" alt="" />
<br/><br/><a href="http://www.businessinsider.com/brazil-agriculture-boom-mato-grosso-2012-12#brazil-is-in-the-top-5-worldwide-for-most-major-crops-and-is-now-the-fourth-largest-grains-producer-in-the-world-4">See the rest of the story at Business Insider</a> http://www.businessinsider.com/farm-bill-big-agribusiness-snap-2012-11Big Agribusiness and Food Stamp Recipients Both Hope Congress Fails To Pass A New Farm Billhttp://www.businessinsider.com/farm-bill-big-agribusiness-snap-2012-11
Sat, 17 Nov 2012 08:26:00 -0500Lucas Kawa
<p><img style="float:right;" src="http://static5.businessinsider.com/image/50215a41eab8ea0141000008-400-300/farmer.jpg" border="0" alt="farmer" /></p><p>The beginning of fiscal cliff negotiations has overshadowed the need for Congress to resolve another issue in a state of impasse: the passage of a new five-year farm bill.</p>
<p>Rep. Kristi Noem (R-SD)<a href="http://www.agweek.com/event/article/id/72574/publisher_ID/4/%20%20%20%20%20%20%20%20%20%20%20%20%20%20%20%20%20%20%20%20%20"> told reporters yesterday</a> that a farm bill &ldquo;is definitely on the agenda to deal with by the end of the year&rdquo; and that the potential savings included in the bill would be a boon to fiscal cliff negotiations.</p>
<p>If no agreement can be reached, the continuing resolution agreed upon in September, which <a href="http://sustainableagriculture.net/blog/continuing-resolution/">increases 2012 levels of funding by 0.6 percent for the next six months</a>, will remain in effect.</p>
<p>The food stamp program (SNAP) is the largest component of the farm bill, composing <a href="http://www.washingtonpost.com/politics/federal_government/polar-bears-farmers-and-fiscal-cliff-on-returning-congress-to-do-list/2012/11/13/8d2c1bce-2d69-11e2-b631-2aad9d9c73ac_story.html">about 80 percent of its costs</a>. Any new farm bill will reduce the amount of money allocated to the program. The Republican House passed a farm bill this summer that saves $35 billion over ten years and cuts funding to SNAP by $1.6 billion per year. The companion bill in the Senate saves $23 billion over the same timeframe, but cuts significantly less from the food stamp program.</p>
<p>For people who rely on food stamps, the best-case scenario is a fiscal cliff solution that doesn&rsquo;t involve a new farm bill.</p>
<p>Furthermore, the failure to pass a farm bill is also the ideal outcome for Big Agribusiness.</p>
<p>A new farm bill would cut agricultural subsidies by $20 to $30 billion. The Huffington Post <a href="http://www.huffingtonpost.com/2012/11/11/fiscal-cliff-talks-medicare-social-security_n_2113259.html">reports that between 1995 and 2010</a>, 10 percent of farmers collected <strong>74 percent of the subsidies</strong>. Cuts to subsidies would disproportionally hurt Big Agribusiness and have little effect on family farmers.</p>
<p>In any event, those who need food and those who produce it wait together with baited breath in hopes that Congress won&rsquo;t do what it hasn't done since May 2008 and actually pass a comprehensive farm bill.</p><p><a href="http://www.businessinsider.com/farm-bill-big-agribusiness-snap-2012-11#comments">Join the conversation about this story &#187;</a></p> http://www.businessinsider.com/billions-in-tax-dollars-subsidize-the-junk-food-industry-2012-7How Billions In Tax Dollars Subsidize The Junk Food Industryhttp://www.businessinsider.com/billions-in-tax-dollars-subsidize-the-junk-food-industry-2012-7
Wed, 25 Jul 2012 19:05:00 -0400Eric Pianin
<p><img style="float:right;" src="http://static6.businessinsider.com/image/50060a0ceab8ea165d00002b/obese-fat-junk-food-fast-foot-uncomfortable.jpg" border="0" alt="obese, fat, junk food, fast foot, uncomfortable" /></p><p>Childhood&nbsp;<a href="http://www.thefiscaltimes.com/Articles/2010/04/22/obesity-interview-doctor-anjali-jain.aspx" target="_blank" data-bitly-type="bitly_hover_card">obesity rates</a>&nbsp;have more than tripled in the past 30 years,&nbsp;an alarming public health development that is contributing about&nbsp;$150 billion a year to the overall cost of U.S. health care.</p>
<p>Almost one in five children aged six to eleven are seriously overweight, making them highly vulnerable to heart disease, diabetes and other serious illnesses.</p>
<p>At the same time, Congress and the Department of Agriculture are spending more than&nbsp;$1.28 billion annually to subsidize the crops that are used as additives in manufacturing&nbsp;cookies, candies, soda pop and other highly popular&nbsp;<a href="http://www.thefiscaltimes.com/Articles/2012/04/27/How-Sugar-Daddy-Lobbyists-Killed-the-War-on-Obesity.aspx#page1" target="_blank" data-bitly-type="bitly_hover_card">junk food</a>&nbsp;that arguably are among the primary contributors to childhood obesity. The sweet, fatty and calorie-rich Hostess Twinkies alone contain 14 ingredients made with highly subsidized processed ingredients, including corn syrup, high fructose corn syrup, corn starch and vegetable shortening.</p>
<p>What&rsquo;s wrong with this picture?</p>
<p>A new report released on Wednesday by&nbsp;the U.S. PIRG Education Fund, a consumer advocacy group, highlights often tragic consequences of long-standing federal agriculture policies that have showered hundreds of billions of dollars on a small handful of crops including corn and soybeans that are processed into additives.&nbsp;They are the mainstays of the junk food industry.</p>
<p>Of the $277 billion spent on farm subsidy programs since 1995, about $81.7 billion went to subsidize corn and $26.3 billion went for soybeans. In a sign of the political clout of the biggest producers, 75 percent of the all those subsidies have gone to just 3.8 percent of U.S. farmers.&nbsp;In contrast, the government has provided only $637 million for apples or vegetables.&nbsp;</p>
<p><strong><span>RELATED:&nbsp;</span></strong><a href="http://www.thefiscaltimes.com/Columns/2012/07/25/The-Outrageous-Farm-Bill-Thats-Packed-with-Pork.aspx#page1" target="_blank" data-bitly-type="bitly_hover_card"><strong><span>The Outrageous Farm Bill That&rsquo;s Packed with Pork</span></strong></a></p>
<p>The study concluded that &ldquo;our own government policy&rdquo; is responsible for promoting obesity-fueling empty calories,&rdquo; adding that &ldquo;even as nutritionists and researchers tell us to cut down on junk food in order to end the childhood obesity epidemic, federal agricultural policy is busily underwriting the problem.&rdquo;</p>
<p><a class="hidden_link" href="http://www.businessinsider.com/blackboard/indeed">Indeed</a>, the Department of Agriculture which simultaneously administers the farm subsidy program and attempts to promote healthy eating has yet to connect the dots. For example, the department&rsquo;s Center for Nutrition Policy and Promotion (CNPP) conducts research and sponsors programs to improve Americans&rsquo; dietary behavior and combat obesity, but rarely if ever examines the consequences of the federal farm subsidy program &ndash; which heavily influences the public&rsquo;s eating habits.&nbsp;</p>
<p>In the bifurcated world of the agriculture department, the Agriculture Marketing Service oversees the subsidy program and the Economic Research Service does the economic analysis of the impact of the subsidies on food prices. &ldquo;The way that the department is set up, our cut of the pie is coming up with healthy diets &ndash; that is our mission here,&rdquo; John Webster, the CNPP&rsquo;s director of public relations and governmental affairs, told&nbsp;<em>The Fiscal Times</em>&nbsp;on Wednesday.&nbsp;<br />&nbsp;<br />By 2030, half of all Americans will be overweight, adding tens of billions of dollars more to the annual cost of treating them. Obese children have arteries so thick that they resemble those of 45-year-olds, which puts them at greatly increased risk of heart problems and diabetes. And obese adolescents are more likely to be pre-diabetic. Children and adolescents who are obese are also at greater risk for bone and joint problems, sleep apnea, and social and psychological problems such as stigmatization and poor self-esteem.</p>
<p>The report was issued while Congress attempts to rewrite the current five-year farm law which is scheduled to expire Sept. 30. The Senate last month overwhelming approved&nbsp;<a href="http://www.thefiscaltimes.com/Articles/2012/06/25/Senate-Played-a-Shell-Game-with-New-Farm-Bill.aspx?p=1" target="_blank" data-bitly-type="bitly_hover_card">new farm legislation</a>&nbsp;that will cost taxpayers nearly $1 trillion over the coming decade.&nbsp;The bill would eliminate the $5 billion a year in direct payments to producers of corn, wheat, soybeans and other crops, but shifted some of those savings to the already highly subsidized federal crop insurance program, which was created to protect farmers against drought and flooding or precipitous drops in crop prices.</p>
<p>Meanwhile, the House version of the legislation has become bogged down by internal Republican political squabbling, and it is unclear whether the chamber will act before the long August recess.</p>
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</ul><p><a href="http://www.businessinsider.com/billions-in-tax-dollars-subsidize-the-junk-food-industry-2012-7#comments">Join the conversation about this story &#187;</a></p> http://www.businessinsider.com/drones-europe-farms-2012-2DRONES OVER EUROPE? Proposal To Watch EU Subsidized Farmshttp://www.businessinsider.com/drones-europe-farms-2012-2
Fri, 10 Feb 2012 13:10:54 -0500Sanya Khetani
<p><img style="float:right;" src="http://static3.businessinsider.com/image/4f32c7c069bedd4d2f000061/drone.jpg" border="0" alt="Drone" /></p><p>Battlefields will no longer be the only fields drones will be seen in.</p>
<p>The unmanned, remote-controlled aircraft could soon be seen over the farms of Europe, in an attempt to curb cheating on farm subsidies, <a href="http://rt.com/news/eu-drones-policing-privacy-989/">RT</a> reports.</p>
<p>Each year, the EU spends almost half of its budget on its Common Agricultural Policy, and Europe's farms cost taxpayers billions of euros in subsidies.&nbsp;</p>
<p>And where there's the prospect of subsidy, there's fraud. As cheaters gets more innovative, inspectors need to keep up. So they are turning to technology to&nbsp;<span>improve their patchy record on catching fraud.</span></p>
<p>While satellites have been used in the past to keep an eye on subsidy claimants. Satellites provide aerial images of farmlands, which could be checked for breaches of rules (if the farms were not in proper environmental and agricultural condition). It was also much cheaper than sending an inspector to the field, according to <a href="http://www.bbc.co.uk/news/world-europe-16545333">the BBC</a>.</p>
<p>But these images had their limitations: they were inconclusive in unfavorable weather conditions and mountainous terrain. &nbsp;&nbsp;</p>
<p>EU inspectors then tried unmanned aerial vehicles.&nbsp;Drones can get up close and take sharp photographs, and unlike satellites, which always look directly down, drones can get an angled view.</p>
<p>They are currently being tried out in France, Italy, and Spain. But the EU will have to develop new protocol to relax the strict restrictions on civilian drones in order to implement the strategy on a larger scale.</p>
<p>Right now, civilian drones must remain in line of sight of the operator at no more than about 550 yards distance, according to <a href="http://www.popsci.com/technology/article/2012-02/eu-considering-using-drones-police-farm-subsidies-enforce-environmental-rules">Popular Science</a>.</p>
<p>However, not everyone is excited about the new proposal. The campaign group Statenwatch says&nbsp;rushing into the use of drones without enough public discussion could lead to invasion of privacy issues.<span></span></p>
<p>"...The questions about what is acceptable and how people feel about drones hovering over their farmland or their demonstration - these debates are not taking place," <a href="http://www.bbc.co.uk/news/world-europe-16545333">Ben Hayes of Statenwatch told the BBC</a>.</p><p><a href="http://www.businessinsider.com/drones-europe-farms-2012-2#comments">Join the conversation about this story &#187;</a></p> http://www.businessinsider.com/chinas-latest-campaign-love-your-country-buy-cabbage-2011-11You Know Chinese Food Inflation Is Easing When The Government Launches A Campaign Like Thishttp://www.businessinsider.com/chinas-latest-campaign-love-your-country-buy-cabbage-2011-11
Wed, 30 Nov 2011 13:20:00 -0500Andrew Shen
<p><img style="float:right;" src="http://static1.businessinsider.com/image/4ed643a1eab8ea7e2f000035/china-cabbage.jpg" border="0" alt="china cabbage" /></p><p>Chinese cabbage prices are so low that China's Ministry of Agriculture has had to launch a new campaign to promote sales.</p>
<p>"Love your country, buy cabbage."</p>
<p><a href="http://www.wantchinatimes.com/news-subclass-cnt.aspx?id=20111130000001&amp;cid=1201&amp;MainCatID=0">Want China Times reports</a> that the prices of Chinese cabbage, or bok choy, dropped nearly 40 percent since October.</p>
<p><a href="http://www.businessinsider.com/chinas-inflation-rate-slows-slightly-to-61-food-price-inflation-stays-at-134-2011-10">Food inflation was a huge problem </a>leading into October, but now autumn crops are slowing China's overall inflation.</p>
<p>The <a href="http://economictimes.indiatimes.com/news/international-business/chinas-inflation-likely-to-ease-in-november/articleshow/10929733.cms">CPI is expected to drop to 4.3 percent</a> thanks to the abundance of winter vegetables, eggs, and pork.</p>
<p>While this is good for the a nation trying to balance its economic policies, the farmers are struggling to break even.</p>
<p>Just a few days ago, <a href="http://www.ministryoftofu.com/2011/11/photos-radish-rush-daylight-robbery-of-farmer-in-trouble/">"Radish Bro" Han Gang went viral</a> on Sina's Weibo when he started giving away his radishes. His 13 acres of radishes were worth nearly nothing, with bulk rates at 1 Yuan per kilogram ($0.008 per pound).</p>
<p>Tens of thousands raided his farm for days, taking nearly all of Han Gang's crops.</p>
<p>Chinese cabbages and radishes aren't the only foods that have been struggling this fall. <a href="http://www.capitalvue.com/home/CE-news/inset/@10063/post/4421693">Food prices have been falling</a> for six straight weeks, and potatoes are also being promoted in a similar manner -- "Love your country, buy potatoes."</p>
<p>Since Chinese farmers do not have any type of insurance, they are struggling to make ends meet. Drought ruined the summer season for many, and now low prices are making it hard for those who had an outstanding fall harvest.</p>
<p>Fortunately, agricultural prices have <a href="http://www.capitalvue.com/home/CE-news/inset/@10063/post/4527663">rebounded slightly today</a>, but Chinese farmers will still probably have to brace themselves for another harsh winter.</p><p><a href="http://www.businessinsider.com/chinas-latest-campaign-love-your-country-buy-cabbage-2011-11#comments">Join the conversation about this story &#187;</a></p> http://www.businessinsider.com/techno-farming-the-new-economic-growth-industry-2011-7Techno-Farming: The New Economic Growth Industryhttp://www.businessinsider.com/techno-farming-the-new-economic-growth-industry-2011-7
Fri, 08 Jul 2011 16:33:00 -0400Dan Morgan
<p><img style="float:right;" src="http://static4.businessinsider.com/image/4e17689accd1d5a373140000/farm.jpg" border="0" alt="farm" /></p><p>Farming isn&rsquo;t what it used to be, following breakthroughs in technology and production practices that promise greater efficiency, healthier foodstuffs, less dependence on chemicals, and increased markets overseas.</p>
<p>Yet many policy makers in Washington are oblivious to these developments, as they are preoccupied with the federal deficit.</p>
<p>Not since the New Deal has agriculture played such a central role in Washington politics&mdash;but rather than food security, the focus is squarely on spending cuts.</p>
<p>Democratic and Republican budget negotiators are considering cuts&nbsp;in commodity payments and crop insurance totaling $34 billion over 10 years, which, if approved, would be more than a 50 percent reduction in the <a href="http://www.thefiscaltimes.com/Articles/2011/06/02/Farm-Subsidies-Are-on-the-Chopping-Block.aspx" target="_blank">$63 billion currently projected</a>&nbsp;to be spent on <a href="http://www.fb.org/assets/files/fbn/2011/FBN_07-04-11.pdf" target="_blank">government commodity price and income supports</a> in the coming decade.</p>
<p>Lost in this narrow, green-eye-shade focus on the bottom line is any discussion of new federal policies that might lock in agriculture&rsquo;s key role in the U.S. economy for the rest of the century by making it more sustainable, energy efficient, and environmentally friendly.&nbsp;&nbsp;&nbsp;&nbsp;</p>
<p>&ldquo;U.S. farm policy seems to be driven by one objective at the moment: how to reduce costs,&rdquo;&nbsp; David Blandford, professor of agricultural economics at Pennsylvania State, told <em>The Fiscal Times</em>.&nbsp;</p>
<p>This absence of &ldquo;the vision thing&rdquo; among Washington agriculture policy makers is especially a problem because&mdash;technological breakthroughs aside&mdash;American agriculture is nonetheless facing &ldquo;daunting&rdquo; challenges.</p>
<p>An exhaustive 570-page <a href="http://www.nap.edu/catalog.php?record_id=12832" target="_blank">report by the National Research Council</a> has detailed growing stress on soil, water, and air from large scale commercial farming and concentrated animal production. These factors are contributing to declining water tables and aquifers, soil erosion, greenhouse gas emissions, loss of biodiversity, chemical runoff, and compromised animal welfare and food safety.</p>
<p>&ldquo;There is growing recognition and evidence of the unintended consequences of agriculture,&rdquo; stated the 2010 report. Since half the land mass of the United States is in farms and ranches, the environmental implications are vast.</p>
<p>Ironically, while Congress and the White House are paying scant attention to the long-term challenges of agriculture, many producers in the $400 billion a year farm industry have taken matters into their own hands. Many commercial farmers and ranchers have introduced <a href="http://www.earthtimes.org/climate/new-farming-methods-reduce-greenhouse-gases-improve-yields/264/" target="_blank">new practices</a>&nbsp;such as conservation tillage, crop rotation, grazing patterns that keep more carbon in the soil, and &ldquo;closed loop&rdquo; systems that turn farm animal wastes into energy.</p>
<p>An organic foods industry that has been doubling in size every year has demonstrated that farming with <a href="http://www.wisegeek.com/what-is-modern-farm-life-like.htm" target="_blank">fewer chemicals</a>&nbsp;can be good business. Thanks to a growing demand for local produce, the number of small farmers has begun increasing.</p>
<p>At the same time, according to research by Purdue University&rsquo;s Department of Agricultural Economics, &ldquo;farming is in the midst of a major transformation&mdash;not only in technology and production practices, but also in size of business, resource control and operation, business model, and linkages with buyers and suppliers.&rdquo; Successful farming businesses are charging premiums for products that are low in fat or were raised without chemicals or antibiotics and this &ldquo;branding&rdquo; is sure to gain steam, according to the report.</p>
<p>Some experts see farms becoming platforms for a range of profitable activities, including producing energy crops (&ldquo;grassoline&rdquo;) or specialized fruits and vegetables alongside traditional staples such as corn, wheat, soybeans, and cotton; selling power to the grid from solar arrays and wind turbines; and marketing the carbon they store in the soil to polluters who need carbon credits.&nbsp;</p>
<p>Federal policies urgently need updating to get behind these changes, according to many agricultural scholars, scientists, economists and farmers themselves. Instead, the intense focus on cutting subsidies has left the impression among many people outside farm country that agriculture is a kind of struggling welfare sector, obsessed mainly with getting and protecting federal handouts.</p>
<p>Over the decades, farm support has morphed into a web of overlapping, duplicative and just plain bewildering programs, some dating to the Great Depression. A public system benefiting mainly major crops such as corn and wheat provides income support, compensates for low prices, and guarantees relief in case of floods or droughts. Alongside that is a privately run, but federally subsidized crop insurance system covering more than 100 crops, including the major ones, grown on 255 million acres. Periodically Congress enacts special &ldquo;disaster&rdquo; relief on top of that.</p>
<p>Less known is the fact that U.S. agriculture&rsquo;s dependence on government has been declining, mainly because commodity prices have stayed well above support levels.</p>
<p>This year, USDA predicts that farmers will pocket profits of $94.7 billion on sales of more than $400 billion, making it one of the most recession-proof parts of the economy.&nbsp; Direct government aid, in the form of income support, conservation grants, disaster relief and the dairy program is projected to shrink to $10.7 billion&mdash;the lowest amount in a decade and <a href="http://www.ers.usda.gov/briefing/farmpolicy/gov-pay.htm" target="_blank">a rounding error in the overall federal budget</a>.&nbsp;</p>
<p>And taxpayer costs of the <a href="http://johanns.senate.gov/public/?a=Files.Serve&amp;File_id=bf3ed081-ec5a-4b34-80bd-1ae25878492" target="_blank">crop insurance program also declined</a>&nbsp;to $3.7 billion in 2010 from $7.3 billion the previous year.</p>
<p>Congress provides $6 billion a year in subsidies to prop up the domestic ethanol industry, even while the price of competing gasoline is at near record highs and the price of corn to manufacture ethanol is extremely low. The Senate voted 73 to 27 last month to eliminate the subsidies, but that provision is unlikely to go any further this year.</p>
<p>Another prime target of deficit-reduction negotiators is a program that shells out $5 billion a year in income support to farmers (and some wealthy landowners in big cities) even when prices and profits are high.</p>
<p>But the helter-skelter search for cuts is occurring without any overarching strategic vision. The House earlier this year approved a fiscal 2012 spending bill that makes deep reductions in agricultural research, overseas food assistance, and incentives for sustainable farming practices. Blandford, the Penn State agricultural economics professor, cautioned that &ldquo;A &lsquo;slash and burn&rsquo; approach is not likely to meet future needs given the substantial challenges that the U.S. farm sector is likely to face in coming years.&rdquo;</p>
<p>The initial battleground for a shift to a new federal approach will be the debate over a five-year farm bill, due to begin next year. Supporters of current farm programs have already made clear that in a tight budget situation, their top priority will be protecting&nbsp; traditional programs, not extending innovative ones approved in the current farm legislation. These include such things as federally-funded research into ways to reestablish a large-scale fresh fruit and vegetable industry in rain-fed parts of the eastern United States.</p>
<p>As the process begins, there appears to be an appetite for new ideas among farmers and ranchers themselves.&nbsp;</p>
<p>&ldquo;We must move beyond &lsquo;us vs. them&rsquo; and &lsquo;either-or&rsquo; conversations,'&rdquo; said Dan Glickman, a former U.S. agriculture secretary who is a co-chairman of the group with the hopeful acronym of AGree.</p>
<p><em>This <a href="http://www.thefiscaltimes.com/Articles/2011/07/06/Techno-farming-The-New-Economic-Growth-Industry.aspx">post</a> originally appeared at <a href="http://www.thefiscaltimes.com">The Fiscal Times</a>.</em></p><p><a href="http://www.businessinsider.com/techno-farming-the-new-economic-growth-industry-2011-7#comments">Join the conversation about this story &#187;</a></p> http://www.businessinsider.com/farm-subsidies-are-on-the-chopping-block-2011-6Farm Subsidies Are On The Chopping Block http://www.businessinsider.com/farm-subsidies-are-on-the-chopping-block-2011-6
Fri, 03 Jun 2011 13:14:25 -0400Eric Pianin
<p><img style="float:right;" src="http://static1.businessinsider.com/image/4de915304bd7c82d730d0000/wheat.jpg" border="0" alt="wheat" /></p><p>It seemed gutsy when Republican presidential hopeful <a href="http://www.nytimes.com/2011/05/24/us/politics/24pawlenty.html">Tim Pawlenty</a> traveled to politically pivotal Iowa recently and vowed to help end federal ethanol subsidies &ndash; the mother&rsquo;s milk of ethanol producers and the Midwestern farmers who supply the grain used to produce it.</p>
<p>&ldquo;We need to cut spending, and we need to cut it big-time,&rdquo; Pawlenty said, adding, &ldquo;we can&rsquo;t have any more sacred cows.&rdquo;</p>
<p>But Pawlenty, the former Minnesota governor, is hardly the first prominent farm- state politician to take aim at the once politically sacrosanct ethanol program--or other costly farm safety net programs. With <a href="http://www.thefiscaltimes.com/Articles/2011/03/02/Inflation-Rears-its-Ugly-Head-as-Gas-and-Food-Prices-Rise.aspx?p=1">food prices soaring</a>, farm <a href="http://seekingalpha.com/article/271206-farmer-income-positioned-to-rise-to-record-levels-in-2011">incomes at record levels</a> and Congress and the White House negotiating ways to slash the $1.5 trillion budget deficit, many lawmakers and farm groups see the handwriting on the wall.</p>
<p>Case in point: Sen. Chuck Grassley, R-Iowa, a farmer himself and long a champion of the agricultural industry, last month introduced legislation that will significantly reduce <a href="http://www.economist.com/blogs/democracyinamerica/2011/05/ethanol_and_iowa?page=1&amp;fsrc=rss">tax incentives for ethanol </a>over the next two years before converting the program to a small tax break tied to fluctuations in crude oil prices.</p>
<p>Ethanol is an alcohol-based fuel made from fermented corn and blended with gasoline. For years producers and distributors have been showered with tax credits, tariff protections, and favorable government mandates. But the subsidies have fueled <a href="http://growinggeorgia.com/scienceeducation/1895-ethanol-subsidies-to-what-extent-do-they-influence-corn-prices-and-food-prices">grain and food inflation</a>, leading many to question why ethanol needs government help at a time when oil companies are charging exorbitant prices for gasoline.</p>
<p>Grassley, a senior member of the Senate Finance Committee, described his proposal as &ldquo;a responsible approach&rdquo; that would gradually eliminate the $7 billion-a-year subsidy, but without &ldquo;pulling the rug out from under the only domestic renewable energy source that is making significant contributions to our energy supply.&rdquo; The two Democratic senators from Pawlenty&rsquo;s heavily agricultural state--Al Franken and Amy Klobuchar--have cosponsored Grassley&rsquo;s bill, along with Senate Budget Committee Chairman Kent Conrad, D-N.D., and other Democrats and Republicans from rural Iowa, Nebraska, and South Dakota.</p>
<p>Meanwhile, House Republican leaders, the White House, and <a href="http://www.thefiscaltimes.com/Articles/2011/05/05/Bidens-Gang-of-7-Last-Best-Hope-for-a-Budget-Deal.aspx">a bipartisan group</a> of six House and Senate members led by Vice President Joe Biden have set their sights on a much fatter target--the estimated $20 billion a year in Agriculture Department commodity payments, crop insurance, credits and other programs aimed at stabilizing the agricultural industry.</p>
<p>For example, the House-passed <a href="http://www.thefiscaltimes.com/Articles/2011/04/15/House-Passes-Ryans-Controversial-Budget-Plan.aspx?p=1">Republican budget </a>designed by Rep. Paul Ryan, R-Wis., calls for shaving a further $30 billion from farm subsidies over the coming decade, on top of the nearly $12 billion of reductions in crop insurance and other programs approved within the past year.</p>
<p>The negotiating team headed by Biden is considering cuts in commodity payments and crop insurance totaling $34 billion over 10 years, according to congressional and agriculture industry sources. That would be more than a 50 percent cut in the $63 billion currently projected to be spent on government commodity price and income supports in the coming decade, according to the American Farm Bureau Federation, the lead lobbying group for farmers and ranchers.</p>
<p>&ldquo;We think that&rsquo;s a really disproportionate cut, and we have concerns about it,&rdquo; said Mary Kay Thatcher, director of public policy for the Farm Bureau. &ldquo;Our members have always been very fiscally conservative and for either a balanced budget or a whole lot more balanced budget than we have now, so we would like to see them be serious about deficit reduction, but we really don&rsquo;t want to be taken to task and have only agriculture cut.&rdquo;</p>
<p>But a congressional staffer familiar with the Biden group talks told The Fiscal Times: &ldquo;Ag subsidies were part of the low-hanging fruit.&nbsp; It was an early area of agreement for this group trying to establish common ground. This was one of the first things to go.&rdquo;</p>
<p>Moreover, six liberal-to-conservative <a href="http://www.thefiscaltimes.com/Articles/2011/05/24/Fiscal-Summit-Aims-at-Deep-Gaps-in-Deficit-Plans.aspx">Washington think tanks </a>that prepared major deficit-reduction plans with grants from the Peter G. Peterson Foundation all proposed abolishing or greatly reducing farm subsidies and ethanol credits. (Pete Peterson is a principal backer of The Fiscal Times.) In short, it looks as though there is no way farm subsidies can avoid the budget chopping block this year.</p>
<p>The plan outlined by one of those think tanks, the middle-of-the-road Bipartisan Policy Center, would achieve $185 billion in cumulative savings through 2040 by reducing and limiting payments to commercial farms, reforming the Federal Crop Insurance Program, reducing premium subsidies, and consolidating and capping agriculture conservation programs.</p>
<p>&ldquo;I think every sector of our federal budget will have to be cut and that would include farm programs,&rdquo; <a href="http://washingtonexaminer.com/blogs/local-opinion-zone/2011/03/bob-goodlattes-push-balanced-budget-amendment">Rep. Bob Goodlatte</a>, R-Va., a senior member of the Agriculture Committee, told The Fiscal Times. &ldquo;I think there are good reforms to be made to save a lot of money.&rdquo;</p>
<p>Ryan, the chairman of the House Budget Committee, has argued that there is no excuse for not scaling back programs when the agricultural sector is racing far ahead of the overall U.S. economy and net farm income this year is forecast to be the second-highest recorded in the past 35 years. The Agriculture Department projects net farm income of $94.7 billion in 2011, up almost 20 percent over the previous year and the <a href="http://cofarmbureaublog.wordpress.com/2011/02/15/usda-forecasts-net-farm-income-at-94-7-billion/">second-best year</a> for farm income since 1976.</p>
<p>&ldquo;With crop prices &ndash; and deficits &ndash; hitting new highs, it&rsquo;s time to adjust support to this industry to reflect economic realities,&rdquo; Ryan said in his budget document, &ldquo;The Path to Prosperity.&rdquo;</p>
<p>Federal farm subsidies totaled $245 billion between 1995 and 2009, according to an <a href="http://farm.ewg.org/">Environmental Working Group</a> farm subsidy data base. Ten percent of farmers collected 74 percent of all subsidies amounting to $157.7 billion over 15 years, according to EWG analysis. The biggest beneficiaries were corn, wheat, cotton, soybean, and rice growers.</p>
<p>While the time may seem ripe for trimming or gutting farm subsidies, House Agriculture Committee Chairman Frank D. Lucas, R-Okla., and Rep. Collin C. Peterson of Minnesota, the ranking Democrat on the Agriculture Committee, strongly oppose deep subsidy cuts, saying they ignore the &ldquo;lessons from history&rdquo; that the agricultural economy is cyclical.</p>
<p>&ldquo;It&rsquo;s a mistake for us to undo the safety net,&rdquo; Peterson told The Fiscal Times this week. &ldquo;It&rsquo;s [political] ideology, not common sense. . . . I&rsquo;m O.K. with making some changes, but the reality is, it&rsquo;s too expensive nowadays to farm without having a backstop. And people won&rsquo;t get financed if these prices go down, and we&rsquo;ll end up passing a bill to bail these people out, and it will be the wrong way to do it because it will be done in panic.&rdquo;</p>
<p>Peterson, the former chairman of the Agriculture Committee before the Republicans won back control of the House last year, recalled that the GOP once before sought to eliminate price supports as part of the 1996 Freedom to Farm Reform Act. Congress subsequently had to pass costly emergency legislation to address crop failure due to adverse weather and tumbling commodity prices.</p>
<p>&ldquo;One thing about farmers, when you have good prices, you&rsquo;ll get low prices [eventually], because they&rsquo;ll over produce,&rdquo; he said. &ldquo;Good prices bring the investment, bring the land into production, and then we&rsquo;ll overproduce and then we&rsquo;ll have low prices again.&rdquo;</p>
<p>Peterson said &ldquo;the biggest concern I have now is all of these negotiations are going on and there really isn&rsquo;t anybody in the room that understands anything about agriculture, and that&rsquo;s dangerous.&rdquo; But Senate Finance Committee Chairman Max Baucus, a Montana Democrat well versed in ranching, is part of the Biden negotiating team.&nbsp;&nbsp;</p>
<p><em>This <a href="http://www.thefiscaltimes.com/Articles/2011/06/02/Farm-Subsidies-Are-on-the-Chopping-Block.aspx">post</a> originally appeared at <a href="http://www.thefiscaltimes.com/">The Fiscal Times. </a></em></p><p><a href="http://www.businessinsider.com/farm-subsidies-are-on-the-chopping-block-2011-6#comments">Join the conversation about this story &#187;</a></p>